Patents and Innovation Economics

According to business and patent expert David Kline and Henry R. Nothhaft, CEO of technology miniaturization firm Tessera, Inc. in the Harvard Business Review:

The U.S. Patent and Trademark Office (USPTO) may be the single greatest facilitator of private sector job creation and economic growth in America. It is this agency, after all, that issues the patents that small businesses — especially technology startups — need to attract venture capital investment, develop new products and services, and serve their historic role as the primary source of almost all new net job growth in America. According to one recent study, 76 percent of startup executives say that patents are essential to their funding efforts.

David Kline is an expert in this area. He is author of ground breaking book, Rembrandts in the Attic, on patents in business. He is also author of Burning the Shipsthat explores how Microsoft used patents to transform their business. According to the authors, “The costs of the forgone innovation resulting from patent delays in the many billions of dollars annually.” I think they are underestimating the cost of patent delays.